As 2010 Opens, Some are Living Only on Food Stamps While Homeowners Under Obama’s Loan Plan are Still Foreclosed On

Katie Couric explains the food stamp situation in one of her Notebooks.

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In 2008, a Bush Administration report revealed that 49 million Americans were “at risk” of going hungry, as poverty hit an eleven-year high. These figures, however, don’t mesh yet with the present Great Recession numbers, but it is bound to be worse. So it was not surprising that it was reported in late December that there are now 36,000,000 people on food stamps. That number adds up to one in every eight American adults and one in every four American children.

Among some groups, it’s even worse. Researchers at Cornell and at Washington University found that at some point before they turn 21, 90 percent of kids with single parents – and 90 percent of African-American children – will be on food stamps.

About six million Americans receiving food stamps report they have no other income, according to an analysis of state data collected by The New York Times. In declarations that states verify and the federal government audits, they described themselves as unemployed and receiving no cash aid — no welfare, no unemployment insurance, and no pensions, child support or disability pay.

Their numbers were rising before the recession as tougher welfare laws made it harder for poor people to get cash aid, but they have soared by about 50 percent over the past two years. About one in 50 Americans now lives in a household with a reported income that consists of nothing but a food-stamp card.

This graphic shows the states experiencing a jump in food stamp recipients who have no cash or income or who are not receiving cash assistance; and yes, Wisconsin is experiencing a 56% jump in such recipients. Nothing, however, compares to Nevada and Florida's numbers. Too much gambling? (Courtesy: NYT)

And we are not just talking about homeless men and women here, people pushing carts and sleeping under freeway overpasses. We’re talking about former members of the middle class–professionals, managers, salespeople, etc.–who were bringing in five- and six-figure salaries. Former taxpayers. So what do these people do for money, especially to pay for the necessities, like a roof over one’s head?

[….] Some draw on savings or sporadic under-the-table jobs. Some move in with relatives. Some get noncash help, like subsidized apartments. While some go without cash incomes only briefly before securing jobs or aid, others rely on food stamps alone for many months.

I don’t want to say too much about this, except to admit that I have been on food stamps myself on and off while I have been here in Wisconsin. But I don’t know what I would do without money coming in. There is a part of me that wants to keep my independence and not rely on relatives. Which is why I enjoy this time of temporary income, and hope that it leads to yet another position that is longer than six weeks, long enough to get me where I want to go.

A food stamp allotment goes, like that, at the first of the month. I’ve received upwards to nearly $200, but it is not enough for an entire month, even for a single woman who shares a kitchen with several other women. A lot of times, when I have to make my rent, there’s not enough for food that week. That’s why where I live gets supplemental food donations from restaurants, supermarkets, bakeries, and even health food stores. I don’t want to talk about how single mothers can make $200 stretch for herself and two or more children, or how a working mother, with an out-of-work husband, can make food stretch for a family of two or more children. It’s crazy-making.

The expansion of the food-stamp program, which will spend more than $60 billion this year, has so far enjoyed bipartisan support. But it does have conservative critics who worry about the costs and the rise in dependency.

“This is craziness,” said Representative John Linder, a Georgia Republican who is the ranking minority member of a House panel on welfare policy. “We’re at risk of creating an entire class of people, a subset of people, just comfortable getting by living off the government.”

Mr. Linder added: “You don’t improve the economy by paying people to sit around and not work. You improve the economy by lowering taxes” so small businesses will create more jobs.

Um, I beg to differ about this, because it’s been tried. It’s not the cure-all panacea, and this is not 1922. In response to lowering taxes, business has off-shored many jobs. They bring engineers from India and Taiwan to work in our computer and other high-end industries, while letting qualified Americans languish or break unions. The malling of Main Streets sometimes run out small businesses with high rents. Megastores like WalMart run out small businesses, and when WalMarts leave because they’re not making enough profit in the area, the communities once served die. Excuse me, but Americans need this food. They need to eat. Bad enough we’ve turned into a Third World country because we make almost none of our own goods any more.

Besides, living on food stamps doesn’t allow one to purchase caviar every da. It would better if adults with children could have more benefits in the program, but then again, it’s not meant to make people comfortable, but to supplement them for a while until they can find employment and financial stability. If “a while” means two years, then that’s the way that it is. And in many cases, it takes that long.

Expecting the worst this time around, retailers are trying to reposition their business for what they call a “new normal,” where jobs are scarcer, and more and more Americans depend on the government to make ends meet.

After years of wooing higher income shoppers, national chains are now seeing opportunity in the low end of the market.

Supervalu Inc (SVU.N) recently announced plans to open 50 new Save-A-Lot discount stores this year and to have another 100 stores in the pipeline for next year. The additions will bring its total number of Save-A-Lot stores to about 1,330.

It is paying for the initiative by halving its quarterly dividend.

Family Dollar Stores Inc (FDO.N), which sells most of its merchandise for below $10, began realigning its business even before the downturn. It installed refrigerators and coolers in its stores, enabling it to sell perishable food like milk and luncheon meat, and upgraded its checkout system to accept EBT as payment.

Ten months after the Obama administration began pressing lenders to do more to prevent foreclosures, many struggling homeowners are holding up their end of the bargain but still find themselves rejected, and some are even having their homes sold out from under them without notice.

These borrowers, rich and poor, completed trial modifications of their distressed mortgage, and made all the payments, only to learn, often indirectly, that they won’t get help after all.

How many is hard to tell. Lenders participating in the administration’s Home Affordable Modification Program, or HAMP, still don’t provide the government with information about who’s rejected and why.

To date, more than 759,000 trial loan modifications have been started, but just 31,382 have been converted to permanent new loans. That’s averages out to 4 percent, far below the 75 percent conversion rate President Barack Obama has said he seeks.

I am reminded that Barack Obama was more than just best of two evils or the best of a bad deal, because I cannot imagine McCain or Palin doing anything for the homeowners, who are, by the way, taxpayers. But this piece of news is going to slap the Democrats in the face in the midterm elections coming up. (Maybe Obama doesn’t really like the rambunctious House as much as he likes the old boys in the Senate.) Giving a free ride to Wall Street helps nobody but Wall Street, but giving little or nothing to the voters helps nobody but the other side. When is Obama ever going to wake up and stop accepting advice from Emmanuel, Bernanke, Geithner and the rest of that corrupt domestic, economic crew? I guess that will happen when he doesn’t need the money men to bankroll his 2012 run.

It sure isn’t helping the voters who put him in office, who are both homeowners and taxpayers.

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